The Stress Tests

THE STRESS TESTS:
Ailing Banks Need $75 Billion, U.S. Says (New York Times)
http://www.nytimes.com/2009/05/08/business/08stress.html?_r=1&hp

Stress Tests Results Split Financial Landscape (New York Times)
http://www.nytimes.com/2009/05/08/business/08bank.html?ref=business

Fed Sees Up to $599 Billion in Bank Losses (Wall Street Journal)
http://online.wsj.com/article/SB124172137962697121.html

Bank of America's Lewis Humbled by Vote, Test Results (Bloomberg)
http://www.bloomberg.com/apps/news?pid=20601103&sid=aBUwezciS7_w&refer=us

Stressing the Positive
Paul Krugman, New York Times, May 7, 2009 Washington has made a decision to muddle through the financial crisis, hoping that the banks can earn their way back to health. http://www.nytimes.com/2009/05/08/opinion/08krugman.html?partner=rss&emc=rss


Banks aren't bridges
Fred L. Smith, Jr., USA Today, May 8, 2009 Politicized accounting tests are no match for market-based scrutiny. http://blogs.usatoday.com/oped/2009/05/banks-arent-bridges.html?csp=34


Stress Tests Forever
Sebastian Mallaby, Washington Post, May 8, 2009 Does the government have a duty to test the reactions of banks to future shocks? http://www.washingtonpost.com/wp-dyn/content/article/2009/05/07/AR2009050703538.html?wprss=rss_opinions


Banks in Race to Raise Capital
Theo Francis, BusinessWeek, May 7, 2009 Ten finance giants must raise $75 billion in six months. Unpleasant options await those that get a cool reception in the capital markets. http://www.businessweek.com/bwdaily/dnflash/content/may2009/db2009057_474783.htm?chan=top+news_top+news+index+-+temp_news+%2B+analysis


The Other Stress Test (For Bankers)
Simon Johnson, The Baseline Scenario, May 8, 2009 There is nothing you can teach Wall Street titans regarding the timing of news flow. http://baselinescenario.com/2009/05/08/the-other-stress-test-for-bankers/


Stress Tests: A Test of Transparency
David Wessel, Real Time Economics (WSJ.com), May 7, 2009 One encouraging sign: The prices for insuring bank debt-holders against default - credit default swaps -- on the weakest banks have come down in recent days. http://blogs.wsj.com/economics/2009/05/07/stress-tests-a-test-of-transparency/


What About Stress Testing Pensions?
Leo Kolivakis, Pension Pulse, May 8, 2009 http://pensionpulse.blogspot.com/2009/05/what-about-stress-testing-pensions.html


Feeling less anxious
Free Exchange, Economist.com, May 7, 2009 The American government has pulled off quite a feat, managing to claim that none the nation's largest banks are insolvent, while still sounding vaguely credible. http://www.economist.com/blogs/freeexchange/2009/05/feeling_less_anxious.cfm


The FDIC Needs More Good Hands
L. William Seidman, Wall Street Journal, May 8, 2009 Bank failures won't wait on the bureaucracy. http://online.wsj.com/article/SB124174293713299107.html#mod=rss_opinion_main



State of the global economy:


The Spring of the Zombies Joseph E. Stiglitz, Project Syndicate, May 7, 2009 The good news is that we may be at the end of a free fall...But that does not mean that the global economy is set for a robust recovery any time soon.
http://www.guatemala-times.com/opinion/syndicated/i-dissent-unconventional-economic-wisdom/1096-the-spring-of-the-zombies.html


Tackling Britain's fiscal debacle
Martin Wolf, Financial Times, May 7, 2009 The UK has lost control over public spending. Like it or not, voters must elect a government willing to get it back, writes Martin Wolf. http://www.ft.com/cms/s/0/7ab01302-3b36-11de-ba91-00144feabdc0.html?nclick_check=1


China and Britain need to join hands over crisis
Wang Qishan, Financial Times, May 7, 2009 Our two countries have a lot to offer each other and great potential for co-operation in the financial sector. We should make full and best use of the dialogue between us, writes Wang Qishan. http://www.ft.com/cms/s/0/7be8a018-3b36-11de-ba91-00144feabdc0.html


Exports versus domestic demand - the argument rages
Michael Pettis, China Financial Markets, May 8, 2009 Today's Financial Times and last week's Economic Observer had articles that display the kinds of confusion that economic crises can create among policymakers. http://mpettis.com/2009/05/exports-versus-domestic-demand-%E2%80%93-the-argument-rages/


The Fiscal Challenge
Bruce Bartlett, Forbes, May 8, 2009 Cut out the tea parties and focus on the deficit.
http://www.forbes.com/2009/05/07/deficit-tea-party-opinions-columnists-bartlett.html?feed=rss_opinions http://economix.blogs.nytimes.com/2009/05/07/fed-balance-sheet-expansion-some-takeaways/


Fed Balance Sheet Expansion: Some Takeaways
Catherine Rampell, Economix (NYTimes.com), May 7, 2009 On a visceral level, this chart looks pretty scary. But what does it mean?